Thirteen more banking hubs that can be used by customers of ALL the big banks will open in UK – amid fury that NONE of the ten promised so far have opened
- 13 new banking hubs to help communities access cash to be opened across UK
- Industry experts say move will help stop cash disappearing at a ‘frightening rate’
- Data estimates that by 2031 only 6 per cent of transactions will utilise cash
More than a dozen new shared banking hubs are set to open in a bid to prevent Britain’s most vulnerable consumers from being cut off from cash as banks and ATMs across the country continue to close is spates.
A total of 13 new hubs – that can be used by consumers of all major UK banks – were announced across the UK, with four locations due to open in Scotland, eight in England and one in Northern Ireland.
Despite repeated announcements promising a total of 25 shared banking schemes spanning the breadth of Britain, just two pilot scheme hubs have opened so far.
The excruciating pace of development has left some industry insiders frustrated as communities are forced into cashlessness as bank branches close without replacements.
John Howells, chief executive of the UK’s cash machine network LINK, told BBC R4’s Today programme: ‘Cash is disappearing at a frightening rate and so are ATMs and branches and it is not acceptable to leave communities without free access to cash.
‘The good news is the banks have recognised that, and they’ve agreed to make sure every community maintains a free, shared branch and or a free ATM but the pace now needs to be picked up.’
Mr Howells continued: ‘It’s not right to leave communities without access and the fact we’ve got legislation coming means that should be something which can be overseen by the FCA and make sure we don’t get gaps in service.
‘I think the good news is that I can see real investment and effort going in by the banks [to fix supply]. But that pace needs picking up, it’s not acceptable to have large gaps of many months.
‘The simple answer is, with the FCA overseeing it, you don’t close the last branch until you can guarantee you’ve got a free ATM or a new branch to go in, and I think the legislation going down track, the oversight of the FCA and the work of LINK with the banks should guarantee that for consumers, which is good news.’
A total of 13 new hubs were announced across the UK, with four locations set to open in Scotland, eight in England and one in Northern Ireland
Despite repeated announcements promising a total of 25 shared banking schemes spanning the breadth of Britain, just two pilot scheme hubs have opened so far. Pictured: One of the first pilot Bankhub branches in Rochford, Essex
The excruciating pace of development has left some industry insiders frustrated as communities are forced into cashlessness as bank branches close without replacements [file image]
The first shared banking hubs – in Cambuslang, near Glasgow and Rochford in Essex- were initially announced to alleviate gaps in communities that require access to cash.
They have so far proven to be a boon to their respective communities, with 60,000 customer visits worth £16m already taking place since they opened last year.
The hubs operate operate in a similar way to traditional branches, with banks providing rotational specialists to help staff the new initiative, which will also be managed in conjunction with the Post Office.
John Bachtler, chair of the Cambuslang Community Council, said: ‘The banking hub is the centre of our community and it’s bringing life back to the high street and crucially helping people and businesses with their everyday banking needs.
‘It gets busier and busier every week and we know it will make a significant difference in other communities across the UK.’
But currently only two shared hubs are in operation and there’s a risk that these pilot schemes will shut next April when their future is reviewed.
The developments have led the UK’s financial watchdog to directly call out Britain’s high street banking giants and demand the pace of change be ramped up.
With thousands of banks now gone from High Streets up and down the UK, groups such as the Post Office have stepped in to provide every-day over-the-counter banking services for people in rural communities.
The FCA ‘s comments come as the banks and the country’s biggest building society continue to slash their branch networks and reduce the opening hours of those branches that remain.
Banking expert Derek French, a longstanding champion of banking hubs, welcomes the regulator’s intervention, accusing the banks of slowing down the opening of hubs to the ‘pace of a snail.’
The intervention by the FCA comes as the banks and the country’s biggest building society continue to slash their branch networks and reduce the opening hours of those branches that remain
It comes as fears mount that Britain is charging towards becoming a cashless society with almost a third of all payments now made using contactless cards [file image]
Jenny Ross, Which? money editor, says new shared banking hub services will take on an increased importance as banks shut branches at ‘an alarming rate’.
She said: ‘The country’s cash infrastructure has been cut to the bone in recent years due to ATMs and bank branches closing, leaving millions of consumers who rely on cash and face-to-face banking services at risk of being cut adrift.
‘It’s encouraging to see the banking industry announce more banking hubs which, alongside other bank alternatives such as enhanced Post Offices, could play a role in ensuring local communities’ cash needs are met.
‘These hubs, as well as ones announced in December, must open as soon as possible so consumers can benefit. However, only long-promised legislation will properly protect cash.
‘The Financial Conduct Authority must be given the appropriate powers to oversee the framework of the country’s cash system, including determining a local community’s access to cash needs based on geographic distances, as well as holding banks to account.
‘Given the rate of bank branch and ATM closures in recent years, that cannot happen quickly enough.’
More than 37,000 ATMs are at risk as machine operators warn cuts in the fees they receive from banks could leave firms with no option but to remove them or impose charges
It comes as fears mount that Britain is charging towards becoming a cashless society with almost a third of all payments now made using contactless cards.
Bank branch closures, alongside other trends, have sparked concerns about people’s continued ability to easily access cash.
Just one in six payments were made using notes and coins last year – with cash use falling by 1.7 per cent.
The figures, from banking trade body UK Finance estimates that by 2031 only 6 per cent of all transactions will be made using physical money.
In other developments, one of the UK’s biggest independent machine operators, Notemachine, warned cuts in the fees it receives from banks could leave firms with no other option than to start charging consumers who want to access their cash.
It comes after LINK, which runs the UK cash machine network, told operators the interchange fee, paid to them by banks when their customers use a machine, would not increase despite rises in running costs.
Operators say a failure to raise it in line with interest rates and other costs means an effective cut in income. Typically, a bank pays the operator a 26.5p fee per use, but 29.3p for machines with protected status, where it is seen as essential.
Notemachine said unless the fee is raised, more than 2,100 machines on its network are at risk of becoming pay-to-use.
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